Why Amazon thinks differently of China & India

Amazon India has grown vastly in last three years since it has been established in the country.

Amazon India vs. Amazon China

When Amazon came in India it had no Infrastructure but now it is dominating the Indian markets. Jeff Bezos, chief of Amazon speaks about the initial days of Amazon in India. I feel Indian investors believed India can be a replay of what happened in China and later they found that they were wrong and Amazon team in India did a very good job.

When Amazon came into China in the year 2004 it could not beat its competitor Alibaba which was already ruling Chinese e-commerce market. Now Bezos is more concerned in India.

India’s population is 1.25 billion out of which 500 million’s 35 percent of population uses internet. This shows India is second to China. The yearly growth of people switching to internet is increasing, almost six million people join internet every month. Due to this India is considered most precious for internet users and Bezos is not leaving any chance to collect profits out of it.

Answering Vijay Shekhar Sharma

Paytm founder Vijay Shekhar Sharma, in a conference asked Jeff Bezos about infrastructure issues that company is facing in India to which he answers, “Amazon is working hard for infrastructure. We do most of the transportation ourselves. Regulations too in India are very different. So it is a three piece sales model. We don’t own any inventory sales rather all sales here are marketplace.”

The India strategy

From the failure in China Amazon learnt a lot. Bezos also added “One thing learned from china failure is to adjust or modify the product for local markets. Amazon tried this in India and is getting very successful results.”

In India the biggest competitors for Amazon are Flipkart and Snapdeal, but Amazon will overcome this competition very easily if it continues to grow at the same rate like it is today, as experts predict. These competitors keep on searching for investors in order to expand and this is where Amazon is on upper side. It doesn’t needs investors as it gets them from its global parent.

Amazon being the major player has increased its market share from 14 to 21 percent and hence repeatedly eating the share of Flipkart and Snapdeal. Also the investment of $3 billion will add up to this and help in growth. The Indian head of the company in an interview said that “Amazon India is the biggest e-commerce platform throughout the country.”

Is this ‘The End’ of Flipkart and Snapdeal as Amazon gets more funding by Bezos?